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Karl Marx and Scots Bankers and Toxic assets

by rootless2 Wed Mar 11th, 2009 at 08:34:28 AM EST

Talk about centralisation! The credit system, which has its focus in the so-called national banks and the big money-lenders and usurers surrounding them, constitutes enormous centralisation, and gives to this class of parasites the fabulous power, not only to periodically despoil industrial capitalists, but also to interfere in actual production in a most dangerous manner -- and this gang knows nothing about production and has nothing to do with it.

Marx, Capital Vol. III Part V
Division of Profit into Interest and Profit of Enterprise. Interest-Bearing Capital.

And then he quotes this
"Banking establishments are ... moral and religious Institutions.... How often has the fear of being seen by the watchful and reproving eye of his banker deterred the young tradesman from joining the company of riotous and extravagant friends? ... What has been his anxiety to stand well in the estimation of his banker? ... Has not the frown of his banker been of more influence with him than the jeers and discouragements of his friends? Has he not trembled to be supposed guilty of deceit or the slightest misstatement, lest it should give rise to suspicion, and his accommodation be in consequence restricted or discontinued? ... And has not that friendly advice been of more value to him than that of priest?" (G. M. Bell, a Scottish bank director, in The Philosophy of Joint Stock Banking, London, 1840, pp. 46, 47.)

Toxic assets. 4495. He relates the following case: A Frenchman sends a broker in Mincing Lane commodities for 3,000 to be sold at a certain price. The broker cannot obtain the requested price, and the Frenchman cannot sell below this price. The commodities remain unsold, but the Frenchman needs money. The broker therefore makes him an advance of 1,000 and has the French man draw a bill of exchange of 1,000 for three months on the broker against his commodities as security. At the end of the three months the bill becomes due, but the commodities still remain unsold. The broker must then pay the bill, and although he possesses security for 3,000, he cannot convert it into cash and as a result faces difficulties. In this manner, one person drags another down with him.

So. 'Twas alwasy ever thus.

keep to the Fen Causeway
by Helen (lareinagal at yahoo dot co dot uk) on Thu Mar 12th, 2009 at 12:20:34 PM EST
scale that story in the diary's last para up by a zillion or three, and you have them not just using (mythic) future earnings as collateral, but also their grandchildrens' shirts, Gamblers Anonymous, no sh*t.

the fact that their unbridled greed could lead to war, famine and pestilence for millions, if it even occurred to them at all, would just give extra frisson to the depravity.

what if the dow's surge was a direct reaction to finally seeing some symbolic justice done with uncle bernie?

how about if they slam the others who deserve it too, it'd zoom to 36,000!

'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty

by melo (melometa4(at)gmail.com) on Thu Mar 12th, 2009 at 06:39:35 PM EST
[ Parent ]
does obama have his head on a gold dollar yet?

'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty
by melo (melometa4(at)gmail.com) on Thu Mar 12th, 2009 at 06:41:13 PM EST
[ Parent ]

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